Table of Contents

UAE: Country Economic Forecast: 19 Jun 2013

UAE: The following represents a general Table of Contents outline for the Country Economic Forecast. The actual report may cover any or all of the topics listed below. Highlights and Key Issues - four/five paragraphs of analysis covering the main economic and political issues contained in the subsequent Economic Overview Forecast Table showing % changes for the country - with 2 years of historical data and 4 years of forecast data for the following: Domestic demand Private consumption Fixed investment Stockbuilding (% of GDP) Government consumption Exports of goods and services Imports of goods and services Unemployment Consumer prices Current account balance (US$ and % of GDP) Government budget (% of GDP) Short-term interest rates (%) Long-term interest rates (%) Exchange rate (vs. US dollar) Exchange rate (vs. euro) Economic Overview - two pages of events-driven analysis highlighting the most recent economic activity and, where relevant, political developments of the country, detailing significant changes to Oxford Economics' forecasts Charts and Tables - covering a full range of economic developments relevant to the time period covered. These could include such topics as: Contributions to GDP growth Monthly industrial output Business and consumer confidence Unemployment rate Retail sales Prices and earnings Consumption and investment Government balance and debt GDP and industrial production Monetary policy and bond yields Background Information on the country One or two pages of text covering the main historical political and economic factors that determine the country's current position Key Facts on the country Map of the country Key political facts Long-term economic and social development - changes since 1980 Structure of GDP by output - latest year Long-term sovereign credit ratings and outlook Corruption perceptions index- latest year Structural economic indicators - changes since 1990 Destination of goods' exports -prior years - latest year Composition of goods & services exports - latest year

Description

UAE: Country Economic Forecast: 19 Jun 2013

We continue to expect GDP growth of just below 4% this year and next, modestly lower than the 4.4% seen in 2012. The slowdown will be largely the result of a smaller increase in oil output, whereas the non-oil economy is expected to gain momentum in the next two years. Sectors that have seen prolonged weakness since 2009, notably construction and real estate, are expected to pick up, alongside continued buoyancy in trade and tourism. Despite the acceleration in non-oil growth, inflation is seen at just 1.5% in 2013 as rents will not pick up quickly. In 2014, rental costs will rise more significantly as the real estate recovery gains momentum, pushing overall CPI inflation to 2.4% – but this will still be mild compared to other countries in the region. High oil prices and production pushed up the current account surplus to over 17% of GDP in 2012. But lower oil prices, limited potential for large oil output increases, amid higher supply from North America, and solid import growth will result in a modest fall in the surplus in 2013 and 2014. Slower growth in oil output will also mean that Dubai is likely to outpace Abu Dhabi during the next two years. Over the medium term, we are optimistic about the UAE’s potential, given its progress in diversifying away from hydrocarbon exports and into knowledge-intensive sectors over the past decade. Nevertheless, fitful legal reform, policy uncertainty and low participation rates and labour productivity constrain the medium-term outlook.